萬國法律事務所

Without having to wait for the memorandum of understanding (MOU) on the financial supervisory cooperation between the People’s Republic of China (PRC) and the Republic of China (ROC) to take effect, the restriction on trade in Hong Kong Red Chips and other exchange traded funds (ETF) relating to PRC stock or PRC enterprises via re-consignment through brokers is to be lifted at the earliest by January 2010. Investors only need to wait for a few more weeks.

The Financial Supervisory Commission (FSC) and the Mainland Affairs Council (MAC) of the Executive Yuan, Taiwan have apparently already approved to include Red Chips and PRC ETF in the trade via re-consignment through brokers. However, the most talked about H shares are still excluded from the FSC’s plans this time around. The Taiwan Securities Association is nevertheless of the opinion that, with the MOU to take effect in January next year and the soon to be launched Economic Cooperation Framework Agreement, the wait should not be long before the restriction on H shares is also lifted.